When The Empire Strikes Back: A Lesson About Workplace Retaliation

Kyle Walski had joined Smythe Brothers Finance Group at its inception in the mid-'70s, when he finished his MBA. Peter and Rick Smythe had a dynamic vision to plan retirement packages for clients. Kyle was enamored by their creativity and turned down a six-figure job in San Francisco to join the Smythes' fledgling company in Sacramento.

Walski was witness to a burgeoning company that soon blossomed to a major financial planning house on the West Coast. In seven years, they had 150 employees, three offices, and a host of clients to keep them busy for decades.

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They were once a small group of three men who sought to change the world and create innovative retirement packages. They had grown up together, serving respectively in each other's weddings, attending christenings -- even sharing beers during a couple dramatic divorces. Though the financial group was bursting at the seams, Walski and the Smythes remained bosom buddies. With the expansion, Walski was named vice president of the San Diego office at 45 years old, relocating his family and leading an office of 49 people.

All was well; their "boys club" company was on top of the world until the sudden death of Peter Smythe in a single-engine plane he was flying to San Francisco. His brother, Rick, sustained a closed head injury in the accident. Walski was also in the plane and he suffered a concussion and lost his left hand. The tragedy precipitated the sale of Smythe Brothers Financial Group. The name might have stayed the same, but the culture radically changed.

Walski returned to work 12 weeks later; about a month after the sale of the business. The new CEO, Barker Sims, met him at the door. Walski had not heard good things about him from the office gossip that reached him while he was on leave. Barker Sims extended his hand to Walski -- then recoiled, remembering that Walski had lost his hand in the accident. "Good to have you back Kyle, your staff speaks fondly of you...."

Walski remained edgy, and still maneuvering his sling, "Ah, sure. I'll come to you."

Sims nodded and gestured with a casual captain's salute: "3 p.m."

Walski was relieved, but felt awkward. Something wasn't right. He had been with Cherise over six years, and he was really depending on her during this tough transition. Everything had changed.

After fumbling through his email, and returning a few calls, Walski took in a few meetings with staff. He had learned about the abrupt buyout, the funeral, and changes to the firm. He also noticed that a few key people had left. Time passed quickly on his first day back, and it was 3 p.m., however Barker Sims was not available for their appointment. In fact, he wasn't even in the building. His secretary seemed surprised.

"I don't know why he would say three o'clock. He had a 3:30 p.m. flight back to Sacramento. He left 45 minutes ago."

Walski wanted to chalk it up to a misunderstanding, but more of these mishaps continued. The regional staff meeting was rescheduled, but didn't show up on his calendar. His office was supposed to be retrofitted to help with his disability, but the contractors were rescheduled at least three times. He got the little accounts, while his major accounts were never reassigned back to him. When he asked why, he was told, "We are doing you a favor -- letting you coast a while."

Walski knew there was no such thing as coasting in finance. His client base had dwindled and he was shuffled out of meetings. After five months of this, he put his concerns in writing. He was quite explicit with Barker Sims in an email followed by a certified letter. He specifically stated: "I believe my large accounts and responsibilities have been stripped of me because of my recent disability and loss of my left hand.... It is clear to me the organization is uncomfortable. I would like to schedule a meeting to discuss how to rectify the situation."

Walski was sickened that he even had to write such a message. He grew up with the Symthe Brothers. A group that might have been a bit of a boys club, but they allowed time off, even for pregnancy and funerals. They never treated people like this. It was once a great place to work. Now Walski could even feel the tension and disappointment among veteran staff.

Three days later, Walski heard from Barker Sims via email. "I received your email and letter. We understand that your recent injury has been an inhibitor to your previous duties. Therefore, we are transferring you to our Santa Barbara office as the director, reporting to the vice president. Feel free to take the next three weeks off to clear your office and relocate. We do have relocation assistance available as well.... Please contact us if you have any questions...."

WHAT?! Walski was being relieved of his vice president position and moved to the smallest office in the firm? He had two kids in school; his wife just got a promotion. He can't just up and leave. He can't afford the pay cut. But he realized he had no support here. Walski did not respond to Barker Sims' email. He saw the three weeks as opportunity to do research and call his attorney.

The EEOC reported retaliation as the single largest type of complaint in 2010, surpassing race as the largest category. A record number of 36,258 retaliatory complaints were filed. In short, retaliation is when an employee complains about his or her civil rights, and then faces an adverse employment action. In fact, in several cases the original complaint of discrimination was denied, but the complainant prevailed on retaliation. In Walski's case, he complained that his workload changed because of his disability; then the organization took a retaliatory action by demoting and transferring him. Retaliation doesn't have to equal termination, just a tangible loss through a change in employment status. How can employers guard against retaliation charges?

Treat all staff equitably and by policy. Treating someone differently because of gender, race or disability can fuel an EEOC complaint.

Once an employee complains, whether valid or not, respond quickly and in earnest. In fact, thank the employee for bringing the situation to the organization's attention. Conduct a proper investigation.

During an investigation, be thorough, but also avoid too wide of a net. Remember that everyone who participates in the investigation is ALSO protected by Title VII and ADA laws.

Guard against retaliatory action, especially if the complaining staff member is a documented stellar employee. Once someone complains about his or her civil rights, an abrupt change in employment status, transfer, separation, demotion or any change in status can be viewed as retaliation.

Remember, some cases of discrimination can hold the manager or supervisor PERSONALLY liable. Be sure to know the Title VII policies.

Walski took his email and Barker Sims' responses to his attorney during his three weeks off. They quickly constructed a demand letter outlining what Smythe Brothers needed to do: Properly retrofit Walski's office, restore him as vice president of the San Diego office and return his clients and his secretary if possible. Failure to do such would result in a lawsuit in district court.

Walski also called Rick, the surviving Smythe brother, to inquire about Barker Sims and the temperament of the company. Rick Smythe revealed that the company was facing eight other complaints and violations since Smythe Brothers was bought out 11 months previous. They were enduring 35 percent turnover, productivity was down and clients were leaving. The once-prominent Smythe Brothers was in free-fall. Rick had plans to buy back a significant part of his company and bring a number of ethical investors with him. He offered Walski an opportunity to join as an owner/manager.

Two months later, Smythe Brothers was reacquired by Rick Smythe, along with Kyle Walski and other investors. An audit of the organization revealed several problems in compliance, including lack of compliance with Title VII regulations. Barker Sims was fired for mismanagement of funds and the rash of discrimination cases. With Walski and Rick Smythe back at the helm, Smythe Brothers would endure a major restructuring to return to its former luster. As part owner, Walski was reinstalled as vice president in San Diego. His former secretary returned to assist him in rebuilding staff and morale. Walski brought personal experience about diversity management to the firm's restructuring efforts. The following are objectives that Walski instituted to protect the new Smythe Brothers.

Hire an Equal Employment Opportunity officer or consultant for the firm.

Develop a committee across all three offices so that an EEO presence is overt and accessible for all employees.

The EEO office creates a regular training schedule to include a mix of internal talent and external consultants.

The EEO office and other HR representatives revise the employee handbook and train all managers about policies in hiring, firing, transfer and demotion.

Exit interviews are established as staff leave the firm.

Walski realized that even the original Smythe Brothers were open to a lawsuit as many EEO protections were not in place. As vice president, he knew that the company paid over $1.3 million dollars to defend or settle the rash of discrimination complaints that cropped up over the last year. While diversity management once seemed like a minor concern, he realized that it was an essential and efficient sector for any business. Being on both sides of the fence, he renewed a commitment to diversity that not only protected the new growth at Smythe Brothers but his own concerns as well.